Founded in 1760 by Pierre Lorrilard in New York, Lorrilard Tobacco Company is the United States' oldest tobacco company, and one of the leading cigarette businesses in its homeland today.
While originally created to produce pipe tobacco the company's product line rapidly expanded to counter the changing tastes in the New World, introducing snuff, chewing tobacco, cigars and what would become the business's leading product, cigarettes.
Success for the company was rapid, and the product's reputation for quality spread throughout the country. By the 1880s, Lorillard was producing 50000 Taylor Mades (an early cigarette) a day, with production rapidly expanding to fill growing demand (reaching 1 billion a year in 1883).
In 1926, Lorillard released its first manufactured cigarette Old Gold. The brand made history, introducing the first blind fold test on the general public in publicity efforts. These innovative marketing methods where combined with Lorillard's use of radio sponsorship.
Following on the success in radio advertising, Lorillard expanded its advertising with television. The company, and its product Old Gold, would produce one of the iconic images of the age, boxes of cigarettes dancing across a stage.
Moving quickly in the 1950s to counter the growing belief of the risk of smoking, Lorillard released its first filter product in 1952, Kent. The business aggressively marketed this innovation, claiming that its 'micronite' filter was the "Greatest health protection in cigarette history" and that it had discovered the substance in air filters in nuclear plants.
Following up on the success of Kent, Lorilland released the menthol cigarette Newport in 1957.
The company also faced litigation in 1950 due to marketing claims it had made regarding Old Golds in 1942. The FTC while agreeing that the product did have the lowest tar and nicotine levels of its competitors, the advertisements that were running at the time were inaccurate in claiming that the brand was a health choice for consumers.
Lorillard dedicated significant attention to its marketing programs in the 1960s attempting to appeal to the consumers of the day, which were undertaking extensive social change. Around this time, Lorillard released its first low tar and nicotine cigarette, True.
In 1968, the company's ownership changed, with its merger with Loews Corporation. At the time of the merger, the company had made impressive progress with its goal to maximize employee productivity, with over 2000 cigarettes being made in Lorillard factories a minute.
With the banning of TV and radio commercials in the tobacco industry, Lorillard rapidly realized the future importance of billboard space will have on their business, and would become the largest outdoor advertiser in the United States. Despite the brand's initial success, Newport in 1972 underwent an in-depth analysis to discover ways to improve lagging sales. These measures were a success and Newport would soon become one of the leading cigarettes in the country.
A production record was made in 1975, when continued advancements in manufacturing technology allowed the company to produce 4000 cigarettes per minute throughout the country. The company also judged the market for low tar cigarettes to be increasing, and released light versions of Kent and Old Gold in the late 1970s. By 1978, 80% of Lorillard's sales were from the low tar market.
Undeterred from the looming threat of heavy litigation on the tobacco industry, Lorillard continued to pay heavy attention to marketing their brands. This dedication also placed Lorillard in a positive position compared to its US competitors - many that had neglected their brands in order to focus on selling the most cigarettes.
A significant role in supporting their brands was the modernization of their marketing images, to suit the changing tastes of its consumers, and the general change in society since the programs where originally developed.
Other than Newport, many of the company's other brands faced considerable challenges throughout the 1990s from budget brands, reducing market share considerably during the period. To assist in maintaining the company's market share as a whole Lorillard released many reduced price brands in the 1990s in an effort to capture sales.
The business also expanded its operations overseas, beginning with the introduction of distribution of products in 1993 to Africa which were soon expanded to the Middle East, Europe and Asia.
The company faced a substantial defeat in 1998, along with the entire US tobacco industry, with the establishment in 1998 of the Master Settlement Agreement, which while removing the risk state liability from the business, but also caused an extensive cost.
The ownership structure undertook a major change in 2006. Lorillard had been placed in a holding company called Carolina Group which up until this point had been wholly owned by Loews Corporation. However, Loews reduced its holding of the Carolina Group to 46.3% and the company was listed on the New York Stock Exchange.
With brand market share once again increasing, the security of Lorillard is all but assured in the future. The company boasts being the forth largest tobacco company in the United States, and their product, Newport is the second greatest selling cigarette on the US market.
Like all tobacco companies, Lorillard has been exposed to many claims and criticisms of its operations. The company began to receive substantial complaints in the early 1980s regarding the use of asbestos in its filters in the Kent line of cigarettes from 1952 to late 1956. The filters contained the most unstable and carcinogenic form of asbestos, blue asbestos and caused a variety of illness within the factory that manufactured the filters. Due to the similar illness that is caused by asbestos on cigarettes, it is unknown the effect this decision on the health of Kent smokers during this period.
Lorillard also received claims of targeting their menthol cigarette brand Newport to African Americans in the early 1990s, with a substantial amount of advertising space in poor urban areas being devoted to marketing the brand.
In 1995 the company caused an uproar with the medical community with the production of advertisements for Newport depicting a pregnant (or a woman who looked pregnant) being given candy and cigarettes by a young man. By this stage the risks of smoking while pregnant was well known and the advertisement was claimed to display a poor example.